Every organization can share horror stories about struggling to leverage data in more effective ways. Recently, I came across an anecdote that reflects what many of us experience:
A CEO implements a new business intelligence system that he hopes will deliver the cross-functional insights needed to produce a planning forecast. He meets with his systems manager for a status update on this project – only to receive disappointing news.
The manager points out that the system simply could not handle the sheer volume of data required to combine the necessary inventory data, sales data, and market-strategy data needed to support the simulation capability.
In a split second, all signs of hope on the CEO’s face disappear, leaving him with no option other than to raise the one question he never wanted to ask. “How long will it take you to clean up the data and write a simulation program that will give us some answers?”
“Nine months, maybe a year,” replied the systems manager.
“Because all our data are frozen into these other programs?” the CEO inquired.
“That’s the main reason,” the systems manager responded.
Sound familiar? Unbelievably, this story was published in the Harvard Business Review – in 1973!*
Now almost fifty years later, you would think that all the technology at our fingertips today makes this story obsolete. Right?
The Importance of Data Synthesis
Many organizations are still dealing with challenging obstacles when trying to unlock data from various cloud-based and on-premise systems. Sales, marketing, finance, legal, and operations – all these functions have their own data lakes begging for a unifying application that can visualize their numbers in relation to the rest of the business. And even now, a goal of “nine months to a year” might actually be fairly optimistic!
Assuming organizations could deliver an integrated data set, they would need to embrace a trait that Nobel Prize–winning physicist Murray Gell-Mann predicted would become the most valued in the 21st century: synthesis.
The ability to synthesize information is particularly crucial for leaders. They must encounter big-picture complexity to make choices and strategies that often lead to enormous consequences for their business, employees, customers, and the larger world. And since they command more information sources than most people, executive-level and organizational leaders have a greater chance of becoming confused, distracted, or, even worse, misdirected. Decision-makers must be knowledgeable enough to know which information to follow and ignore and how to organize it into a practical framework.
Our Vision: Balancing Technology and Thoughtfulness
“I want to store more data!”
Said no Head of HR, ever.
At SAP SuccessFactors, we believe that HR organizations and their executives should always have access to the full power of data in conjunction with, not isolated from, their peers in other business functions. This vision is based on a balance of modern, powerful technology and respect for HR’s unique pressures and responsibilities to their customers (including business leaders, people managers, and employees).
From our perspective, HR’s analytics capabilities should demonstrate six fundamental attributes:
- Thoughtfulness: A relentless focus on understanding how HR and their customers consume data
- Simplicity: Consumer-grade user experiences that do not require an IT team to create and maintain
- Empowerment: Access to tools that allow users to build analytics and plans on the fly, while staying true to your business’s strategy
- Completeness: The ability to leverage a comprehensive library of content that is constantly updated and expanded
- Intelligence: Applications embedded with machine learning or artificial intelligence to generate well-rounded insights faster across a variety of viewpoints
- Flexibility: The choice to implement reporting capabilities needed today and scale up or down as needs change over time
As a complement to SAP SuccessFactors Workforce Analytics (delivered inside the HXM suite), SAP Analytics Cloud solution gives HR organizations a 360-degree view of their data, coupled with integrated data sources from the enterprise. The solution bolsters the broad nature of the analytical investigations and predictions often conducted by HR professionals.
And with the Business Technology Platform (of which SAP Analytics Cloud is part), our customers build integrations and extensions to supplement native functionalities available in SAP SuccessFactors Human Experience Management (HXM) Suite.
Sample Use Cases for SAP Analytics Cloud in HR
SAP Analytics Cloud offers HR organizations a unique opportunity to own the process of sourcing, integrating, and publishing data. They can also apply connectors to the SAP SuccessFactors Employee Central and SAP SuccessFactors Workforce Analytics solutions and hundreds of other HR solutions and leverage prebuilt templates from a business content library.
Each of these possibilities opens the door to use cases that most HR organizations consider critical for overcoming current challenges, including:
1. Workforce Modeling and Forecasting
According to a Harvard Business Review study, 84% of people managers believe their organization underutilizes HR data in enterprise planning, which should inform future investments. Instead, they say too much attention is paid to operational or financial metrics.
HR leaders committed to driving best-in-class enterprise planning based on HXM insights often use SAP Best Practices packages for workforce modeling and forecasting. This approach allows them to create insights into current costs and capacity and use predictive models to anticipate future workforce demand and supply.
2. The Drivers of Terminations
A company’s termination rate is the percentage of employees who leave an organization during a certain period of time. It is the most popular talent management metric. However, it doesn’t provide the insight needed to understand why employees leave for a better job opportunity elsewhere.
This use case provides visibility into factors that influence individual employee’s flight risk – the likelihood them leaving the organization – and calculate each person’s potential risk rate. People managers can weigh the impact of salary merit increases, bonuses, and role and organizational changes, all in one solution for analytics and planning.
3. Financial Analytics Dashboard
By integrating SAP S/4HANA Cloud with SAP Analytics Cloud, financial analysts and HR planners can benefit from a financial analytics dashboard. This integrated tool visualizes finance and HR metrics to measure the top- and bottom-line impact of workforce investments. The dashboard features a prebuilt set of live analytics tools, key performance indicators, profit-and-loss reporting, and balance sheets.
Conclusion: Meeting the Pent-Up Demand for Analytics in HR
A gap exists between HR’s unquestioned need for better analytics and the function’s ability to consistently deliver on that vision. Perhaps it’s time for HR organizations to take control of their analytics capabilities and apply them with broader business intelligence activities.
That’s the beauty of SAP Analytics Cloud. Siloed forecasts are replaced with enterprise-wide, real-time planning. More importantly, people managers can benefit from a data-informed culture focused on building a more stable, empowered, and engaged workforce.
Visit the SAP Discovery Center site to explore these HR use cases and more enabled by SAP Analytics Cloud. To learn even more, register to attend SAPPHIRE NOW to hear about the advantages of SAP Analytics Cloud and the SAP Business Technology Platform.
*“Computer Data Bases: The Future Is Now,” Harvard Business Review, September 1973.